Money tip #70 – How the self employed can now get up to 40% off the cost of a scooter or motorbike thanks to the taxman

A change to the Finance Act buried deep in the pages of the March budget means that the self-employed can now "completely offset the purchase price of a new scooter or motorbike against their income for tax purposes", says Miles Brignall in The Guardian.

‘’Get On, a campaign group set up by motorbike and scooter manufacturers to promote two-wheeled travel, says it has identified a change to the Finance Act which means self-employed riders buying a bike solely for business use can deduct 100% of its cost from their taxable profits by claiming it as an annual investment on their tax return.

The group says the change in the law means those who pay 40% tax could save £2,728 on the cost of a new £6,821 Honda CBF1000. At the other end of the scale, commuters who only want a 50cc bike can find ones starting at £499 at Direct Bikes. By writing off the cost against tax, the bill is in effect reduced to £400 for a lower-rate taxpayer and £300 for a higher-rate one.

The move will particularly appeal to self-employed workers who want to buy a scooter or motorbike to travel to clients – particularly in London, where two-wheeled transport escapes the £8-a-day congestion charge.’’